Mexico couldn’t protect its own agriculture from the fluctuations of the world market. A global coffee glut in the 1990s plunged prices below the cost of production. A less entrapped government might have bought the crops of Veracruz farmers to keep them afloat, or provided subsidies for other crops.
But once free market structures were in place prohibiting government intervention to help them, those farmers paid the price. Veracruz campesinos joined the stream of workers headed north. There they became an important part of the workforce in the Smithfield pork processing plant in North Carolina, as well as in other industries.
THE PRODUCTIVE PROCESS FLOWS TO THE LOW-WAGE AREAS
In mid-June, 2006, Ford Corporation, already one of Mexico’s largest employers, announced it would invest $9 billion more in building new factories. Meanwhile, Ford said it was closing at least 14 U.S. plants, eliminating the jobs of tens of thousands of U.S. workers.
Both moves were part of the company’s strategic plan to stem losses by cutting labor costs drastically and moving production.
When General Motors was bailed out by the U.S. government in the current recession, it closed a dozen U.S. plants and laid off tens of thousands of workers. Its plans for building new plants in Mexico went forward without any hindrance.
This was excerpted from “Part 1: Migration: A Product of Free Market Reforms,” by David Bacon. Bacon’s three-part series on immigration is published in full by The Americas Program.
